If each firm in an oligopolistic market matches price decreases but does not match price increases
A. prices become flexible.
B. prices become rigid where the marginal revenue and average cost curves intersect.
C. price wars ensue, and economic profits fall to zero.
D. prices become rigid at the prevailing market price.
D. prices become rigid at the prevailing market price.
You might also like to view...
When does the burden of a tax imposed on a good fall more heavily on sellers?
What will be an ideal response?
When yield curves are flat
A) long-term interest rates are above short-term interest rates. B) short-term interest rates are above long-term interest rates. C) short-term interest rates are about the same as long-term interest rates. D) medium-term interest rates are above both short-term and long-term interest rates.
The aggregate supply curve reflects the inverse relationship between the interest rate and the quantity of real GDP supplied
a. True b. False Indicate whether the statement is true or false
If the U.S. government decides to eliminate a budget surplus by reducing taxes, the most likely effect would be
a. falling prices. b. a reduction in the trade deficit. c. an increase in unemployment. d. upward pressure on prices.